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What is Siacoin?
The interest in Sia and the Siacoin price has varied widely throughout the years. Sia is a fully decentralized cloud storage – just like Google Drive, Dropbox or Amazon, only open-source and built on top of a blockchain. Siacoin is Sia blockchain’s native cryptocurrency, which has seen major ups and downs in its valuation in 2018.
Compared to the centralized legacy competitors that are prone to single points of failure and are often suspected of taking advantage of unencrypted data for higher business profits, the Sia platform offers a much more robust and affordable alternative. It pools together a large amount of unused storage space and supercharges it with blockchain to guarantee complete safety and privacy. This means the platform’s users don’t have to trust a third party to play nice or worry about a crashing server.
On their official website, Sia team elaborates: “The long-term goal of Sia is to be the backbone storage layer of the internet. We believe data should be free. We aim to liberate the unused bits of the world and construct the largest storage super server on the planet.”
How does Siacoin work?
Sia combines a peer-to-peer network with blockchain technology, creating the world’s first decentralized storage solution. It essentially allows users to “rent out” their unused hard drive. And for this reason, many have come to know Sia as the “Airbnb of hard drives.”
There are several key aspects that make Sia a very interesting project.
First of all, Sia offers complete privacy. Since all the files are split apart and decoded before they’re distributed via blockchain to numerous hosts’ devices across the world, no single host has an entire file, ensuring privacy and security. Bottom line is that if one device fails, you won’t lose your file. In fact, because every file is split into 30 segments, even if 20 out of 30 hosts go offline, a Sia user will still be able to access their files.
Sia platform is also more secure than any of the centralized storage providers because it encrypts each file segment before it leaves the renter’s drive. Traditional storage providers like Amazon don’t encrypt files at all, which puts the renters at great risk – if the provider’s servers are hacked, renters’ data are compromised. Sia ensures security by allowing hosts to store only encrypted file segments, rather than whole files.
Once the files are split into many segments and distributed to hosts, the renter gets a set of private keys. It’s impossible to reassemble and decode the files without these keys, adding another layer of security and privacy.
Another great feature of the Sia platform is that the market determines the price – meaning the hosts are free to set their own prices for renting out the unused hard drive space. This pricing model ensures the marketplace stays competitive over time.
The agreed pricing, uptime commitments or any other agreement terms (even things like penalties) are enforced by self-executing smart contracts. This means there are no intermediaries or third parties, so the agreement is always between a renter and a host only.
All payments are made using the native cryptocurrency Siacoin, so more adoption and use would be good for the Siacoin price. Renters pay hosts for the storage using Siacoin, while hosts deposit Siacoin into each contract file as collateral.
And finally, Sia platform leverages the proof of storage concept as a way to protect renters from any malicious or fraudulent activity. To receive payment, a host must provide proof of storage to the network within a given time frame. If they fail to do so, the payment is sent to missed proof address until proper proof is submitted. The provider may also be penalized or their contract terminated entirely. Similarly, when a host successfully provides a proof of storage, they receive a payment to a valid proof address. (This governance model is unique and unlike Bitcoin’s proof-of-work).
Who is behind Sia?
The concept of Sia was first conceived by the now-CEO David Vorick in 2013. Soon after that, he got a fellow Rensselaer Polytechnic Institute student Luke Champine involved in the project and they decided to pursue the idea full-time.
The duo held a successful crowdfunding campaign and later raised $1.65 million through venture capitalist funding and grants.
According to the company’s official website, there are now seven full-time people on Sia’s team.
What’s to come?
The Sia platform is a built and functioning product, which is already a great achievement in the blockchain world. There are many upgrades planned on the roadmap, and for now, the Sia team offers a tested, flexible, decentralized solution to existing cloud storage services.